Luxembourg: Taxation of stock options, warrant schemes | KPMG | GLOBAL
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Luxembourg: Taxation of stock options, warrant schemes

Luxembourg: Taxation of stock options, warrant schemes

The Luxembourg tax authorities issued Circular n°104/2 (29 November 2017) that provides for changes to the tax treatment of transferable stock options and warrants as well as in the reporting obligations of all stock option schemes.


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The circular also clarifies to some extent the scope of application of this specific tax regime. The circular replaces earlier guidance from 2012, 2013, and 2015. The new circular includes guidance concerning:

  • An increased valuation of the transferable stock options and warrants from 17.5% to 30% 
  • Guidelines for “reasonable conditions” 
  • An exclusion for employment-termination indemnities 
  • Pooled-stock option schemes 
  • Employer’s reporting obligations with respect to providing notice to the tax authorities

Most of the changes are effective as from 1 January 2018


Read a December 2017 report prepared by the KPMG member firm in Luxembourg 

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